To enlighten u, 90% of the Real Sector of the Nigerian Economy has been stagnant for close to two decades now.
Apart from Oil & Gas, telecoms, real estate & the typical importation/buying & selling, what else is working?

Our textile mills r down?, Our steel sector is dead, we can't even generate enough power to adequately serve a quarter of Lagos
Even the Unilevers of this world r gradually importing their products from the Ghana setup.

Oh yes, i forgot, our mega banks aint giving no long term loans to the SMEs that need em.

All in all the economy is stagnant, they say HE THAT IS DOWN SHOULD NOT BE AFRAID OF FALLING

So i_laugh, do u need further explanation.


ROGER THAT

Nuttin makes me laugh more when i hear u people talk about Ghana, Come and see for yourself now, You would love Naija Die, You clowns just type whatever you think just because you have access to a computer, we have power problems because of the ever increasing population and infrastructures and we would have been able to reduce all that if we didn't have that man in Ota farm, Anyway Please whatever you don don't say Ghana coz there economy is crashin even the value of their currency is fallen badly most especially after the redomination of the Cedi, So Mr Calm down,

They’ve constructed a risk ranking based on seven indicators: current account financing gap, FX reserves/short-term external debt ratio, exports to-GDP ratio, private credit-to-GDP ratio, private credit growth, loans-to deposits ratio and banks capital-to-assets ratio.

@ felifeli

Where do you stay? you are a fool for that statemenT u made! and ShuT da Fuckin mouth of us!!! , I just called my bro and he told me petrol litre is still 70 per Litre!!

Stop giving FAKE NEWS here,

Nigerian economy where there is no set rule, nobody knows what the interest rate was, if borrowing, you will haggle with your bank manager, who will take ten percent of what he eventually borrowed to you in bribe. Ministers don't know simple economic index like rate of unemployment, inflation rate, customs and excise rate of goods and services. If you import anything, you are at the mercy of crooked customs officers, who charge what they want you to pay of which 60% goes to their pocket.

Establish a manufacturing firm, next you know it, the raw material needed is branded contraband before the structure of the factory is finish. Go to tax office, nobody knows what your tax rate is and you only had to haggle with those at the Inland Revenue. That is not what you call safe.

Anyone who tells you what you wanted to hear about yourself is not a friend but an enemy. Meryl Lynch played a big role during Abacha's era in investing their stolen loot from Nigeria, so how on earth will anyone listen to them on Nigerian economic index if they can't even fathom to open a business in Nigeria?
Anyone going to Nigeria for any sort of investment, all I can say to you is good luck because you going to need it in abundance. Every person in Nigerian office has his own company where they will hijack contracts they knew next to nothing about and before you know it they will mess your life and hard earn cash you have come to invest.

Eziachi:

Nigerian economy where there is no set rule, nobody knows what the interest rate was, if borrowing, you will haggle with your bank manager, who will take ten percent of what he eventually borrowed to you in bribe. Ministers don't know simple economic index like rate of unemployment, inflation rate, customs and excise rate of goods and services. If you import anything, you are at the mercy of crooked customs officers, who charge what they want you to pay of which 60% goes to their pocket.

Establish a manufacturing firm, next you know it, the raw material needed is branded contraband before the structure of the factory is finish. Go to tax office, nobody knows what your tax rate is and you only had to haggle with those at the Inland Revenue. That is not what you call safe.

Anyone who tells you what you wanted to hear about yourself is not a friend but an enemy. Meryl Lynch played a big role during Abacha's era in investing their stolen loot from Nigeria, so how on earth will anyone listen to them on Nigerian economic index if they can't even fathom to open a business in Nigeria?
Anyone going to Nigeria for any sort of investment, all I can say to you is good luck because you going to need it in abundance. Every person in Nigerian office has his own company where they will hijack contracts they knew next to nothing about and before you know it they will mess your life and hard earn cash you have come to invest.

merryl lynch is being paid to lead you all into a false sence of security and you are all happy. run out go put your money in stocks and start celebrating because meryl lynch abi na leech say so.

Nigerian journalists are known to publish press releases as news. Let's wait until we see the report.

oga seun thank you

That our economy in Nigeria is "not" affected by the global financial crises is bi- symmetrical.

1. It indicates the viability of our nation as a hope for the professed future economic hub of the world.

2. It is however, a strong index of the irrelevance of our economy in the scheme of things amongst the comity of nations. Else, how does one explain that what is ravaging developed nations and growing economies has refused to pinch our shirt? It is an indication that we are not, if otherwise, very, relevant in the economy of the globe.

To a layman, we are 'yet to be' relevant in the world's economy!

However, as this continues, pls let us enjoy it for as long as it lasts!

BTT:

That our economy in Nigeria is "not" affected by the global financial crises is bi- symmetrical.

1. It indicates the viability of our nation as a hope for the professed future economic hub of the world.

This has been the case from the very beginning. Was the case 30 years ago, still is.

BTT:

2. It is however, a strong index of the irrelevance of our economy in the scheme of things amongst the comity of nations. Else, how does one explain that what is ravaging developed nations and growing economies has refused to pinch our shirt? It is an indication that we are not, if otherwise, very, relevant in the economy of the globe.

To a layman, we are 'yet to be' relevant in the world's economy!

However, as this continues, please let us enjoy it for as long as it lasts!

We have been "enjoying" THIS for over 40 years now, how much longer will THIS last?

interestin thread! going round and round, repeatin the same words! yes nigeria economy is safe and good for its low inconsequential capacity in the global world ! get that in your he[b]ad experrrrrrrrrrrrrrrrt[/b]

nigeria simply dnt need anybody to tell them numerous potentials to be harness in our economy. as for now a lot of employment comes from the bank,telecom and federal sector .Nevertheless the huge % revenue generated comes from the oil, sure we can do better than that.

build good solid roads network nationwide

create reasonable steady 24-7 power

By providing power, alot sysytem which is dependent on power will improve, atm, intenert,telecom,etc

now i thiink the rest wil be history

so can yall stop foolin yourself

lol. my fellow Nigerians, i want to quickly ask one question, has the westerners started accepting bribes? Well may wonder why such question when we are debating Nigeria amongst the safest economy in the world. I want to know how much Merrill Lynch, was paid to come up with this fictitious and frivolous analysis? It is only a slowpoke that will waste his or her time contemplating on Merrill's analysis, it is completely false.

Before one can give a qualitative analysis of the economical safety of a country, you must first of all consider the poverty level of the citizen and infrastructure/ basic amenities. Where and where has the so called Merrill visited in Nigeria (although its not necessary before analogy) but the truth must be told, Ghana should be rated first in terms of economical safety including other African country before Nigeria. But in terms of corruption from the presidency to the common village counselor, i can count Nigeria first in Africa as a continent. Lets advice those in authority to vegetate and indemnify in the endeavors for a better Nigeria tomorrow.

May God help Nigeria, Amen

he that is down need fear no fall.

yemmyse:

he that is down need fear no fall.

This has got to be the most hillarious of all the responses on here!!! So true ooo!!! ROFLMAO!!!

all this bullshit talk. do u see anyone investing? everyone is playing safe. so, yeah, it is the safest economy

This must be the joke of the century.

I bet Siemens once said nigeria's economy is one of the best in the world till we all found out about the shinanigans they have been up to, and what about what halibuton said about our great nigeria and her resources after we found out that they have bribed their way into making nigeria officals sign out our resources and many more.
Merrill Lynch comment on nigeria economy is no surprise, lets just wait for some months before we start seeing the damage they too have inflicted on our fragile economy

Meryl Linch ko, Meryl Linch ni. . . if they were that sound, they should be standing fully on their own now. Abegi, make we hear word jare. Let them put their house in order first. Remove the log in ur eye. . .

courage89:

They’ve constructed a risk ranking based on seven indicators: current account financing gap, FX reserves/short-term external debt ratio, exports to-GDP ratio, private credit-to-GDP ratio, private credit growth, loans-to deposits ratio and banks capital-to-assets ratio.

Using those indicators, it can be seen why they could conclude that Nigeria is the safest economy

1. our FX reserves are at an all time high, we settled some major debts during OBJ's tenure,
2. we don't export much apart from oil and most of our products are consumed internally meaning that external influences cannot affect them adversely.
3. Our banks don't give out much credit so we are not likely to experience any sub-prime like crisis soon.
4. With the banking consolidation, our banks have become much stronger and "seem" to be practicing better risk management practices

indeed our economy has reached a sort of steady state which I feel can only be upset to go on a major downturn by a major shift in the Oil and gas sector (which is possible if a major breakthrough in green technology occurs) or go on an incline when we become more self sustaining by a major stimulation of our manufacturing sector by a government with some vision.

Our economy is mostly isolated from the global economy in terms of our income apart from Oil & Gas which will always be in demand provided all other things remain equal, this will however not remain the same for example if Obama keeps to the campaign promises of opening up the american oil reserves.

Most other nation's economies are tightly linked to the American economy which has taken a battering and will require some time to recover, some countries like Ireland where I live depend so much on the American economy that they will have to borrow money from the European Central bank to finance their next year's budget while the emerging eurozone and Chinese economies are still "emerging" and are still tightly coupled to the American economy particularly the Chinese economy which is mostly a production and export oriented economy (the exact opposite of the Nigerian economy).

In fact, at the start of the dollar's free fall, some economists postulated that it was an attempt by the USA to halt China's rapid economic expansion  but that was before the problems with Fannie Mae and Freddie Mac made it obvious that there were more fundamental problems that needed to be corrected.

The guy who gave the analogy of a parked car in the garage wasn't too far from the truth, infact he did hit the nail on the head but I guess his cheeky tone upset some blokes.  I say this because:

1. Our FX reserves make us credit worthy but we have an apathy towards taking on more debt because our experience with the  Paris club, London club and IMF is still very fresh in the memory but without this massive injection of capital some of our major problems will remain with us (only problem is that taking on more debt does not guarantee their solution as we are all aware of our corruption albatross). So while we choose the  safe option, we are missing out on opportunities to further stimulate redundant sectors of our economy and becoming a major world player in the process.

2. Our economy remains subject to fluctuations in the oil market, giving us a window of 40 years to diversify our economy (if those who estimated our oil reserves are to be beleived) or till the moment any distruptive alternative energy discovery becomes a mainstream product which reduces the need for oil. Your guess is as good as mine of what will happen to our dear country if this should happen as Zimbabwe might only be a tip of the ice berg that a Nigerian economic crisis would be if such a thing happens. If it becomes that bad, we can always go back to the farms and become a total agrarian society again.

3. Provision of credit by our banks to both private individuals and businesses alike while increasing their risk exposure, also stimulates spending and the concurrent circulation of money in turn stimulates job creation leading to an active economy. It is akin to storing your money in a hole in the ground where you are sure you can dig it up again rather than starting a trade with it where you could lose money with unlimited liability

4. Good risk management practices by our banks will keep all our minds at rest but there is a risk of banks becoming too conservative in their approach to provision of credit facilities with resulting economic stagnation.


Bottom line is that, the Merryl Lynch pronouncement is yet another case of the glass being half full or half empty as it is a matter of perspective and gives room for sentiments of either misplaced patriotism/optimism or misplaced skepticsm. The study is meant to provide investors with information to inluence their decisions and it should "ideally" make Nigeria attractive to investors but it has not examined other non numerical indicators such as the legal framework for business, insurance, regulation, infrastructure e.t.c. which are collectively called "The Nigerian Factor" which any intending investor would do well to get up to speed with before committing capital.

hhaaahsaa

lookin around ha

2 above post

u said it all, but know what the fuss is all about, blinded statment!!

If Merrill Lynch says Nigerian economy is the Worlds Safest Economy to invest I wont be suprise. Why? Because it has been so. Perharps they have just discovered it after loosing billion of dollars in other countries. They should have asked companies like Shell, Chevron, Mobil, Lafarge, Virgin, Julius Berger, MTN, Pentascope, Zain, Arab contractors, etiselat and a host of other companies in Nigeria. What makes it safer is because of our foolishness and also the government is so mad about foreign investors that they shield them from all economic loss. There is no any foreign company in the country that have ever reported loss. Once a foreign company makes its way to Nigerian show, it dictates the economic terms of any agreement, transaction terms, market prices. These companies account are never properly audited by government agencies. They only pay taxes they wish to pay and n some cases they dont even pay because they hardly declare some of the income they made. Take for instance the case of Virgin Nigeria, where Richard Brandson was dictating to government of Nigeria how to run its airports. The government gave him preferential treatment over all airline operators, even the he is not providing a better service than other airline. Take for instance the case of Pentascope in the Nitel deal. The government just gave them Nitel free of charge to manage and take away all d profit. Nitel was estimated to have made loss close to £100m, while Pentascope is making profit they have never made. Take the instace of the Ajakuta steel industry. The Indian guy was given the giant steel industry to steal anything he want and sell. No one says anything because he is a foreign investor.
Foreign investors are modern 'colonia' masters. They dictate what happened in our country. All foreign investor are their to exploit. They are not into manufacturing but stealing. Have anybody ever wondered why Shell, Mobil, Chevron and other oil companies didnt care to have Refineries in Nigeria? Cos they are not investors but exploitors. Countries like China and India understand the difference between investors and exploitors. They welcome any company in their country ready to produce/manufacture their but not exploiters. That is y today u will C a Toshiba TV made in China. U C a Dell PC made in China. U c a Nokia handset made in China. Do u think it is only because of cheap labour? Labour is Cheaper in Nigeria than in China or India.
For Merrill Lynch to say that Nigeria is good place for Investment, we have to watch out. Cos these companies are targetting the oil dollars make up for their loses.

duduspace:

Using those indicators, it can be seen why they could conclude that Nigeria is the safest economy

1. our FX reserves are at an all time high, we settled some major debts during OBJ's tenure,
2. we don't export much apart from oil and most of our products are consumed internally meaning that external influences cannot affect them adversely.
3. Our banks don't give out much credit so we are not likely to experience any sub-prime like crisis soon.
4. With the banking consolidation, our banks have become much stronger and "seem" to be practicing better risk management practices

indeed our economy has reached a sort of steady state which I feel can only be upset to go on a major downturn by a major shift in the Oil and gas sector (which is possible if a major breakthrough in green technology occurs) or go on an incline when we become more self sustaining by a major stimulation of our manufacturing sector by a government with some vision.

Now, I am not an economist, but I have to ask. When you say “our economy has reached a sort of steady state”, What in the world do you mean? Paying off of debts started back during Abacha’s time, but most all the others have remained the same way for over 30 years. What did we reach? When?

duduspace:

Our economy is mostly isolated from the global economy in terms of our income apart from Oil & Gas which will always be in demand provided all other things remain equal, this will however not remain the same for example if Obama keeps to the campaign promises of opening up the american oil reserves.

Someone noted that oil prices have now fallen below $58 a barrel and may continue to fall. The Country is already scrambling for ways to find loans.

Now, I am not an economist, but I have to ask. When you say “our economy has reached a sort of steady state”, What in the world do you mean? Paying off of debts started back during Abacha’s time, but most all the others have remained the same way for over 30 years. What did we reach? When?

interestin stuff!! i think the poster have made his ideas clear, but to some, they will keep foolin around as always. he did mention ng economy depend solely on oil, as for now it being a steady substainance but  with the obama quest for green fuel, what might be the future? ng hasnt reached so low like the case in some african country, despite its not so vabriant economy coupled with intense corruption, no body is cryin over bank takin over their house, companies goin into ligidations etc in respite with the so called top 20 economies.If any of the top 20 economies is viewed on the same platform with the nigeria, i reckon things will be so bad for them, suprisingly nobody is lookin the way doe. There will be serious mass unrest hmm

Someone noted that oil prices have now fallen below $58 a barrel and may continue to fall. The Country is already scrambling for ways to find loans.

repeatin that phrase is like repeatin abc u know to a child. With the global world under threat from 419 whiteman global warning, there is utter and urgent need to generate natural gas. a lot of whitepipu find crude gas very expensive which is the driver of any economy in the world. as a nigerian with all these corruption that keep surface in the front page, we really dnt need any loan. we should cut our coat according to its size. if nigeria ever account for 60% of money that goes under, why would any sensible being enbark on such a profound and anticipated mess


gettin 2 lost in assument could drag one to complacency u know ha hence stupid  and uncesessary question popin up

author=Kobojunkie link=topic=196465.msg3109908#msg3109908 date=1227125968]

Now, I am not an economist, but I have to ask. When you say “our economy has reached a sort of steady state”, What in the world do you mean? Paying off of debts started back during Abacha’s time, but most all the others have remained the same way for over 30 years. What did we reach? When?

You just wan argue. he didn't say it was good. Steady means it's going nowhere nor is it falling back. Compared to the 80s and 90s, it is steady. The excessive inflation rate and devaluation of the currency does not exist compared to the absurd shocks and falls of earlier times. That is steady. He did not say we are now world champions or people are not suffering in Naija.

Someone noted that oil prices have now fallen below $58 a barrel and may continue to fall. The Country is already scrambling for ways to find loans.

The government budget has always been at $59 a barrel, even during the boom. That's how they got the huge external reserves which makes Soludo look very wise. Next year's budget will be at $45 a barrel. The external reserves can meet any difference. The country is not scrambling for loans. Show me a quote where they are scrambling for loans. If someone wrote so, it's a lie.

PS There is to be a trend among Nigerians that if anything that is not excessively cynical or detrimental is endorsing the govt. I think the govt. I think it has a lot of problems. I think people are suffering and calling the economy safe though not untrue, is nothing to brag and write about. I don't think the poster was bragging, not Merrill Lynch. Safe has many connotations. You lose nothing, you gain nothing. With the losses mounting in foreign markets, they need to spin something. As someone said, the car parked in the garage is the perfect analogy.

hahhaa

Raskimono:


You just wan argue. he didn't say it was good. Steady means it's going nowhere nor is it falling back.

Compared to the 80s and 90s, it is steadyThe excessive inflation rate and devaluation of the currency does not exist compared to the absurd shocks and falls of earlier times. That is steady. He did not say we are now world champions or people are not suffering in Naija.

I searched my post for the line where I claim he said it is good. Are you sure you are responding to the right thread here?

You say compared to the 80’s and 90’s, the economy is steady. Any reference for this claim? Are you basing this on just the value of the naira? You do realize the world is experiencing a slump at the moment? A Slump that has been years in the making as the value of the dollar has been falling over the past couple of years?


Note QUESTION MARKS.

raskimono

The government budget has always been at $59 a barrel, even during the boom. That's how they got the huge external reserves which makes Soludo look very wise. Next year's budget will be at $45 a barrel. The external reserves can meet any difference. The country is not scrambling for loans. Show me a quote where they are scrambling for loans. If someone wrote so, it's a lie.

[size=13pt]UPDATE 2-Nigeria cuts benchmark oil price to $45 in '09 budget[/size]

http://www.reuters.com/article/marketsNews/idUSLK34620220081020?pageNumber=2&virtualBrandChannel=0


LAGOS, Oct 20 (Reuters) - Nigeria has cut the benchmark oil price in its draft 2009 budget to [size=13pt]$45[/size] per barrel from [size=13pt]$62.5[/size] in the wake of sharp falls in world crude oil prices, signalling significant belt-tightening in Africa's second biggest economy.


The 2009 budget in the world's eight-biggest oil exporter had been due before parliament earlier this month, but a sharp drop in global crude prices has played havoc with the key assumptions on which the spending plans are based.

"We had to take a conservative position, saying $45 a barrel," Mohammed Sanusi Daggash, chairman of the National Planning Commission and a government minister, told reporters during a briefing in the main commercial city of Lagos.

"For us to come in and say we are going to have a budget with a benchmark oil price at $70 a barrel because we need the money, and the oil price now falls ,  would totally destabilise the economy," he said.

Analysts welcomed the proposed benchmark, saying it should help Africa's most populous nation maintain a current account surplus through next year, although it would have a sharp impact on government spending.

"This is a major structural adjustment, which in some quarters might be considered to be overdoing it," said Bismarck Rewane, head of Lagos-based consultancy Financial Derivatives.

"But it is a responsible decision. It is conservative enough. It will mean a lot of belt-tightening," he told Reuters.

Standard Bank estimated the $45 benchmark would translate into a cut of more than 30 percent in budgeted oil revenue.


"It is broadly an excellent policy move," said Mike Hugman, an emerging markets strategist at Standard Bank.

"It will help to ensure that Nigeria maintains a fiscal and current account surplus through 2009 and, whilst it might cause growth to slow marginally, it will also reduce inflationary risks going forward," he told Reuters.



NO MORE FRIVOLITY
Nigeria largely escaped the initial fallout from the global credit crisis.

Oil exports mean it is sitting on foreign exchange reserves of more than $60 billion and it is essentially a cash economy, meaning its banks -- which continue to post record profits -- are much less exposed to the sort of credit risk seen elsewhere.

The West African country saves any oil revenue above the benchmark oil price into an excess crude account, a pillar of IMF-backed reforms meant to guard against price volatility on world markets and help it to save money.

Next year's budget had been based on projected oil production of 2.3 million barrels per day (bpd) at a benchmark price of $62.5, compared with $59 in the 2008 budget.

But fears of global recession have depressed oil demand in the United States and other industrial nations, driving world prices down by more than 50 percent from their peak above $147 a barrel just three months ago.

Nigerian newspapers have reported that tighter spending will mean some ministries receive no budget allocation at all for next year, while spending on things like the purchase of new cars or overseas training for civil servants will be cut.

"Frivolities that will not add to value in government are being done away with," Daggash said.

The adjusted budget proposal is expected to go before the National Assembly in the coming days. (Editing by Ron Askew)

hahhaha expert!

Kobojunkie:


Now, I am not an economist, but I have to ask. When you say “our economy has reached a sort of steady state”, What in the world do you mean? Paying off of debts started back during Abacha’s time, but most all the others have remained the same way for over 30 years. What did we reach? When?


Someone noted that oil prices have now fallen below $58 a barrel and may continue to fall. The Country is already scrambling for ways to find loans.

Pardon me if I didn't explain well, hence my using the phrase "a sort of steady state" I was trying not to get too much into the minutiae of details but I think Raskimono and ikeyman00 have filled in the gaps.

I wasn't trying to big up Nigeria unnecessarily (though I have no grudge against someone who chooses to do that as I beleive you should carry the flag of your country as high as you possibly can within the limits of honesty) but my point is that Merryl Lynch could conceivably have arrived at that conclusion with the indicators used in their study though that says nothing about the relevance of those indicators.

If it makes you feel any better you can consider this seemingly positive statement about Nigeria as a quintessential example of what I call the  "Forrest Gump" phenomenon.

Oil a mixed blessing for Nigerian economy
http://www.un.org/ecosocdev/geninfo/afrec/subjindx/131nigr2.htm


Nigeria is a major world supplier of crude oil, producing about 2 mn barrels per day, and is an influential member of the Organization of Petroleum Exporting Countries (OPEC). Sales of oil account for more than 90 per cent of the nation's total foreign-exchange earnings, and therefore, the lion's share of the funds Nigeria puts into its multi-faceted development programmes. Because of this substantial contribution, Nigeria could well be described as an oil-based mono-cultural economy, and the country's fortunes often rise and fall with the price of oil.

Based on an exchange rate of 86 naira to the dollar, Nigeria expects to earn N454 bn from oil resources in 1999, more than double the N216 bn it earned in 1998, although the latter was at a much higher official exchange rate, N22 to the dollar. Non-oil revenues (customs duties, company tax, value-added tax, independent revenue) accounted for N167 bn in 1998, while N214 bn is projected to be earned from outside the oil sector in 1999.

Nigeria's vulnerability to oil market shifts is well illustrated by the outcome of the 1998 federal budget, which recorded a whopping deficit of N59.8 bn, due largely to the decline in international crude oil prices, the cut in Nigeria's OPEC quota, as well as the closure of many oil wells in the troubled but oil-rich Niger Delta (see "Delta communities protest neglect". Oil-related revenue had been projected to reach $9.8 bn, but fell short by 28 per cent, reaching only $6.3 bn. The government's budget assumptions had proved way off the mark. They were based on a $17 per barrel selling price, while oil prices for the year actually averaged only around $12.5 per barrel. The 1999 budget, based on a forecast of $9 per barrel as the average price for the year, is considered somewhat more realistic.


The impact of the slide in oil prices also was felt in the nation's public service, with potentially serious consequences for the country's political stability. In September 1998, the government raised the salary of public employees by about 300 per cent, to N5,200 per month. But three months later, it had to go back on its promise and slashed the amount by almost half because of declining oil earnings. Then in March it reached agreement with the unions on a new monthly minimum wage, N3,500 for federal workers and N3,000 for those employed by the 36 states. But in April workers in three-quarters of the states went on strike when most state governments failed to implement the new wage for lack of funds.

duduspace:

Pardon me if I didn't explain well, hence my using the phrase "a sort of steady state" I was trying not to get too much into the minutiae of details but I think Raskimono and ikeyman00 have filled in the gaps.

I wasn't trying to big up Nigeria unnecessarily (though I have no grudge against someone who chooses to do that as I beleive you should carry the flag of your country as high as you possibly can within the limits of honesty) but my point is that Merryl Lynch could conceivably have arrived at that conclusion with the indicators used in their study though that says nothing about the relevance of those indicators.

If it makes you feel any better you can consider this seemingly positive statement about Nigeria as a quintessential example of what I call the  "Forrest Gump" phenomenon.

Hey!!! It is a DEBATE forum. These threads are created for people to exchange ideas and debate issues. It is not about it being good or bad as in my opinion, the picture we have today of the economy does not seem a lot different from what we had back 10 years ago. Just wanting to make sure I understand what you mean is why I picked out the portion that I did so you could respond.

Kobojunkie:


Hey!!! It is a DEBATE forum. These threads are created for people to exchange ideas and debate issues. It is not about it being good or bad as in my opinion, the picture we have today of the economy does not seem a lot different from what we had back 10 years ago. Just wanting to make sure I understand what you mean is why I picked out the portion that I did so you could respond.

I know it is a DEBATE forum but I choose to be nice while putting forward my points (a mindset that Obama's election victory seems to prove effective) but I beleive that my points are clear enough and not condescending in any way.

The picture we have today might not seem a lot different but I can assure you that it is quite different with the major difference being that there is some desire (no matter how little) to improve things and a steady though painfully slow return to proper economic management principles.

Also, ten years ago we were just coming out of the Abacha years (when the exchange rate was at an "artificial" N22 to a dollar) and the Naira was on a free fall to the present levels. Since the middle of OBJ's first tenure (about 7 years ago) when Okonjo Iweala and Soludo came into Finance ministry and CBN, the dollar has stayed tightly between N105 and N145 which is why I used the term "sort of steady state".

I also know that Oil prices have fallen and I did point out that our economy is still subject to oil price fluctuations though I wouldn't paint a picture of total gloom just yet as there is still likely to be "enough" demand for oil within the forseeable future but our window of opportunity is closing fast to diversify our economy and we don't seem to be doing enough just yet.

one thing that i have noticed in my short stay on Nairaland is that there are a lot of Nigerians (especially abroad) who appear unable to cope with anything else other than suspicion and failure and that is why they probably will never get better in life. what is wrong with being optimistic ?

@ Kobojunkie

You did not disprove anything I said. I said they budget at $59 a barrel. Your bolded quotes show they do. They never went over $59 even when it hit $145. A proposed budget is not an implemented budget.   Therefore the fact they intended to budget at $62.5 and chose to move it to $45 shows prudence and the safety factor they are employing. If the outlook looks worse they will budget lower. Nothing wrong with that because it means they are not over leveraged.

Even if the budget is based on $150 a barrel, what does that have to do with the economy. That is money that goes to state govt. and Federal institutions to eat and what was not one of the indices used by Merrill Lynch. We are talking about Merrill Lynch establishing a statement that Nigeria economy is safe. No where was Government's budget in it. Strong external reserves in relation GDP. A largely cash economy and a drive of banks to recruit more people to keep their money in the bank. Low inflation rate increase in relation to other countries in the world. High return rate on investment in comparison to other countries in the world. I read the report. Please go and read it.

It is a subjective report and I am an economist and you are not because you are bringing in things not used to calculate the report or are used in economy indices. Nigeria's economy is stronger on macro economic level it's ever been. Safe is a relevant term used in relation to other countries. They did not say it was 100% safe and there will not be some austerity measures. It is safe in comparison to how other countries will be affected.   This is an investment report, not a welfare report and you are using dodgy statistics; going all the way to 1999, ten years ago to establish what exactly; that the govt. budgeted badly in 1999 which led to the prudence that is now part of the system. This is before debt relief and bank consolidation.

You still haven't shown the reports where the govt. is borrowing money to finance its budget. You wrote it. Prove it. It is Soludo's choice not to use the external reserves to supplement the budget just like no matter what, Bush does not release America's large oil reserves to to increase supply and reduce the price at the pump. Soludo thinks austerity is better. I am not as knowledgeable as him. Since I know you just like to argue without substance, I will paste a summary of the report for you to read.

[b]According to the statistics, the world’s 10 least vulnerable economies are Nigeria, Mexico, Phili-ppines, Colombia, Egypt, Oman, Indonesia, Peru, China and Russia.
Also, the report identified Australia, Switzerland, Korea, Romania, Hungary, Sweden, Bulgaria, Euro area, United Kingdom and the United States of America as the highest risk economies in the world.
The risk ranking was based on seven indicators and they are - current account financing gap, foreign exchange reser-ves/short-term external debt ratio, private credit-to-Gross Domestic Product (GDP) ratio, and private credit growth, loans to deposits and banks capital-to-assets ratio. Merrill Lynch said the report also addressed all the requests in 62 indicators of the 60 world economies.
According to the report, Nigeria, with a population of 141.41million, was able to record a 7.3 per cent growth in GDP, with its Consumer Price Index hovering at 11.5 per cent, its current account balance, fiscal balance and public debt at 6 per cent, 6.3 and 10.4 percentage respectively.
To determine its external vulnerability, Nigeria’s external debt position was put at 12.9 per cent of the GDP, while external debt /exports ratio was put at 9 per cent. Her forex reserves totalled $60.8billion.
The percentage of Nigeria’s total external debt in relation to the GDP was put at two per cent, total foreign claims is $15.3billion while international claims stood at $13.1billion.
The report stated that the percentage of Current Account Balance plus net Foreign Direct Investment of the Nigerian GDP was 34, Forex reserves/short-term external debt totalled 41, while percentage of export of the GDP was 38 point.
The percentage of private credit of GDP was 43, while the percentage of bank capital to assets, according to Merrill Lynch was 41.
The 10 most vulnerable countries, which are mostly European countries, were said to have exhibited worse balance of payments positions, stretched external debt service ratios and overleveraged financial systems.
“Many of the economies that top our risk ranking have been identified by the National Bureau of Economic Research (NBER) as those that have experienced capital flow bonanzas in the past five years and hence exhibit higher likelihood of economic crisis,” the report explained.
Explaining further on how it put the report together, Merrill Lynch states that: “While we believe that our country risk ranking produces plausible results, one needs to be aware that, as any ranking of that type, it is highly sensitive to the selection of indicators employed. For example, developed countries can probably sustain higher external vulnerability indicators than emerging markets; some Euro area country statistics are possibly misleading given there is a monetary union.”[/b]